- How financially fit is your non-profit organisation?
- Are its financial resources well managed?
- How healthy are your financial control systems?
This checklist will diagnose the health of your organisation's systems of financial management.
Financial Management for Non Profit Organisations
Filling SARS' Coffers!
We all know how difficult it is to generate funds so it is important to ensure that these valuable resources are not wasted in any way.
In this newsletter, we:
- highlight the potential amounts of those hard-earned resources that could be consumed by SARS by way of interest and/or penalties; and
- provide some tips on how this waste of resources could be avoided.
In terms of the costs, you could be paying:
- Penalties for late or short payment - at a flat rate based on a minimum of 10% of the outstanding tax amount.
- Interest on outstanding tax amounts - charged to your account on a daily basis and calculated at the rate of 9.75% per annum from 1 March 2016. [Please note that this rate changes from time to time.]
- Penalties for not submitting returns - charged at a minimum of R250 per return due.
Here are some tips that will help you to avoid the penalties and interest:
- Ensure the correct tax (PAYE) is calculated and deducted from all employees. [We strongly recommend that, if you calculate salaries manually or by use of spreadsheets, you switch to a reputable software package or use an outsourced service provider.]
- Submit your returns every time on time, even if it is a nil return:
- EMP201 – due by 7th of month after the month in which salaries were paid or accrued.
- VAT 201 (for organisations that are VAT vendors) – due by the last business day of the month after the end of the relevant tax period (when the return is submitted and payment made via e-filing).
- Note that the due date for submission will be a business day. If the 7th or the month end falls on a Saturday, Sunday or public holiday, the due date is earlier.
- Ensure you are paying the correct and full amount of taxes. [Compare the amounts shown on your payroll reports against that month’s EMP201 and reconcile the balance on your VAT control account for the relevant period to your VAT reports before completing that period’s VAT201 and making any payment due.]
We do hope that, by taking note of these warnings and tips and by taking the relevant steps, which are not exhaustive, you will significantly reduce the risks of your organisation having to pay over valuable resources to SARS for interest and penalties.
If you have other tips from your experience of dealing with SARS, please feel free to share them with us as it informs our training and support for the benefit of many other non-profits